Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services.

Why Open Text Corporation Shares Skyrocketed Today

12:50 p.m. ET: The enterprise software company is up a big 19.6% after crushing analysts' quarterly expectations.

What's happening: Shares of Open Text Corporation(NASDAQ:OTEX) were up 19.6% as of 12:50 p.m. Thursday after the enterprise information management software company reported better-than-expected fiscal fourth-quarter 2015 results.

Quarterly revenue fell 2% year over year to $482.7 million, and translated to adjusted net income of $106.9 million, or $0.87 per share. Analysts, on average, were anticipating revenue of just $447.8 million, and adjusted net income of only $0.69 per share.

Why it's happening: OpenText's results would have been even stronger, had it not been for the negative impact of foreign exchange. On a constant currency basis, OpenText's revenue would have climbed 7% year over year to $527.5 million, and adjusted net income would have arrived at $0.98 per share.

"OpenText is helping the world's leading brands digitize their business, both on- and off-premise," added OpenText CEO Mark Barrenechea, "and our strategy is showing bright-line success supported by our strong fourth quarter performance. With a more directly aligned sales leadership team in place, our sales organization performed extremely well in Q4, closing 26 deals over $1 million (11 cloud and 15 license)."

That's impressive however you slice it, and illustrated by the sheer gravity of OpenText's quarterly beat relative to Wall Street's expectations. With shares of OpenText currently trading at an attractive 13 times next year's estimated earnings -- and keeping in mind those estimates are likely to climb now -- it's no surprise the market is so aggressively bidding up the stock today.

Author

As a technology and consumer goods specialist for the Fool, Steve looks for responsible businesses that positively shape our lives. Then he invests accordingly. Enjoy his work? Connect with him on Twitter & Facebook so you don't miss a thing.